Paramount Skydance expects to complete its acquisition of Warner Bros. Discovery on October 6, bringing a transaction backed by Gulf sovereign investors toward closing after a federal court approved a settlement with 12 U.S. states and banks arranged approximately $52 billion in debt financing.
The companies confirmed the expected date in a joint announcement. Closing remains subject to customary conditions. The announcement followed a court order resolving the states’ antitrust lawsuit and modifying an earlier restriction that had prevented the companies from completing the merger.
Agreed in February, the acquisition was originally valued at $110 billion, including debt, with an equity purchase price of $81 billion. Paramount’s original merger announcement set the cash consideration at $31 for each WBD share.
If the deal closes on October 6, eligible WBD shareholders will receive approximately $31.01666668 per share. The combination would bring Paramount Pictures, CBS and Paramount+ together with Warner Bros., HBO, HBO Max and CNN, placing major film, television, streaming and news businesses under the same corporate parent.
Bond Orders Exceed the Investment Grade Offering
Banks completed the syndication of roughly $52 billion in acquisition debt on September 30, according to a report by Bloomberg. Its breakdown comprised $30 billion in U.S. dollar investment-grade bonds, approximately $12.4 billion equivalent in high-yield bonds and $9.46 billion in loans.
Demand for the investment-grade portion exceeded $109 billion when order books closed on September 29. That was about 3.6 times the anticipated $30 billion offering.
Paramount’s financing announcement shows the borrowing costs across the bond maturities. First-lien dollar notes carry coupons ranging from 6.30% on securities due in 2028 to 8.90% on those due in 2066. A second-lien dollar tranche maturing in 2036 carries a 9.125% coupon.
Gulf Investors Take Non Voting Equity Stakes
Saudi Arabia’s Public Investment Fund, Abu Dhabi’s L’imad and Qatar Investment Authority are participating in the acquisition’s equity financing alongside the Ellison family and RedBird Capital Partners.
PIF is expected to hold a 15.1% equity stake in Paramount after closing, alongside L’imad’s 12.8% and QIA’s 10.6%. The three Gulf investors would hold 38.5% of the company’s equity through non-voting shares.
The Ellison family and RedBird will retain all Class A voting shares, while the additional equity investors will receive non-voting Class B shares. The arrangement broadens Paramount’s shareholder base while keeping voting control with the Ellison family and RedBird.
Settlement Creates Obligations Beyond Closing
Court approval comes with operating commitments that extend into the combined company’s first five years. Paramount’s SEC filing confirms that the U.S. District Court for the Northern District of California entered the consent decree and changed the no-close order to permit the merger.
The combined business must release at least 30 films in the United States annually during the first two commitment years and at least 32 annually in the following three. It must also spend an additional $300 million each year on U.S. production against the companies’ combined 2025 baseline, totaling $1.5 billion over five years.
Other requirements cover theatrical release windows, separate negotiations for the companies’ basic cable portfolios and continued operation of their studio lots. Within 180 days of closing, the combined business must establish a five-member News Editorial Independence Board to set principles and resolve specified editorial disputes involving CBS News and CNN.
Paramount said the settlements should not materially affect its previously announced synergy and leverage targets. Management has projected more than $6 billion in merger synergies, including technology integration and procurement savings.
